Gold plunges below $4,100 as hawkish Fed tone hits market sentiment

Gold prices extended their decline on Thursday, slipping below the key $4,100 level after the Federal Reserve delivered a notably hawkish message that dampened expectations for a December rate cut.

.

XAU/USD dropped toward $4,032 its lowest point in days before recovering slightly. The move came after several Fed officials warned that inflation remains too elevated, signaling that easing monetary policy may not come as quickly as markets hoped.

.

The comments sharply reduced the probability of a December rate cut, pushing Treasury yields higher and boosting the U.S. dollar index (DXY). Both factors added significant pressure on non-yielding assets like gold.

.

Key Drivers Behind the Drop

📌 Hawkish Fed remarks lowered expectations for near-term rate cuts

📌 Stronger U.S. dollar increased the opportunity cost of holding gold

📌 Rising U.S. Treasury yields reduced demand for safe-haven metals

📌 Technical pressure as gold failed to reclaim the $4,100 zone

.

Levels to Watch

- Support: $4,064 → $3,886

- Resistance: $4,150 → $4,200

A sustained break below support could open the door to deeper downside in the short term.